Phenix Center for Economic & Informatics Studies Phenix Center for Economic & Informatics Studies
Amman, Tuesday, May 19, 2026
A report issued by the Jordan Labor Watch, affiliated with the Phenix Center for Economic and Informatics Studies, warned against the rapidly increasing reliance of companies and institutions in Jordan on what are commonly referred to as “support service companies” or “outsourcing companies”. The report stressed that this model is being widely used to restructure the labor market in ways that reduce operational costs at the expense of workers’ rights and job stability.
The report noted that this form of employment is no longer limited to secondary or temporary work, but has expanded to include core operational and technical jobs across various sectors, including electricity and energy, healthcare services, security and protection, telecommunications, mining, and logistics. In many cases, outsourced workers perform the same duties as permanent employees within major companies, yet under less favorable working conditions in terms of wages, social protection, and job security.
According to the report, the expansion of outsourcing in Jordan reflects a broader global trend in which large corporations increasingly rely on intermediary companies to hire workers in order to reduce expenses related to wages, social security contributions, and long-term employment obligations.
The report also pointed out that international reports, including those issued by the International Labour Organization, have warned that this shift has contributed to the expansion of precarious work and the decline of stable, long-term employment models, as employment-related risks are increasingly transferred from companies to workers themselves.
The report explained that one of the most dangerous consequences of this model is the creation of a dual labor market within the same institution. Permanent employees enjoy higher wages, social protection, and greater job stability, while outsourced workers often perform nearly identical tasks under weaker conditions, with lower wages, fewer guarantees, and limited opportunities for professional advancement. This, the report argued, undermines workplace fairness and widens inequalities within the same workplace.
The report further warned that restructuring labor relations through outsourcing companies has contributed to the expansion of the “working poor” phenomenon – workers whose wages are insufficient to meet basic living needs despite working full-time.
It also highlighted that this model weakens levels of social protection, whether through the underreporting of wages to social security schemes in some cases, or through disparities in the quality of health insurance coverage and compensation between workers operating at the same site. Such practices negatively affect future pensions and broader social security outcomes.
The report emphasized that the growing dependence on outsourcing companies weakens job security due to the widespread use of temporary contracts and the ease with which workers can be dismissed. It also pointed to the lack of clarity regarding legal responsibility between the principal company and the intermediary company. Moreover, the model limits workers’ ability to organize collectively and demand their rights because of the fragility of their employment status and the fragmented nature of contractual relationships, thereby reshaping the balance of power within the labor market in favor of employers.
The report explained that the expansion of outsourcing companies in Jordan has been closely linked to restructuring policies, privatization, and the growing use of external contracting across many public, semi-governmental, and private institutions as part of efforts to reduce operational expenditures. In practice, however, this has transformed a significant number of relatively stable jobs into more precarious and less protected forms of employment.
The report also noted that the expansion of outsourcing companies did not occur independently of government policies and regulations. In 2024, the government introduced two regulatory frameworks that broadened the scope of this type of employment: The Regulation on Licensing Companies Supplying Jordanian Workers to Service Seekers, and the Regulation on Licensing Mediation Companies for the Employment of Jordanians Inside and Outside the Kingdom. According to the report, this reflects an official trend toward regulating and expanding the role of outsourcing and labor mediation companies in the Jordanian labor market.
In its recommendations, the Jordan Labor Watch called for a comprehensive review of the legal framework governing outsourcing companies, stricter oversight, and the enforcement of the principle of “equal pay for equal work,” stressing the need to ensure that such companies do not become a mechanism for circumventing workers’ rights.
The report also stressed the importance of holding major companies jointly accountable for the rights of workers employed through intermediary companies, strengthening trade union freedoms and representation for outsourced workers, and linking contracting standards to decent work principles and fair wages.
The report concluded by warning that the continued expansion of this model without effective regulation grounded in decent work standards would deepen labor market precarity in Jordan and widen inequality among workers, calling for renewed commitment to the concept of decent work as a foundation for social and economic stability.
